March 19, 2018
Looking for a new van for your business? Then hurry up! There’s no time like the present, with fantastic deals on new 19-plate vans and the opportunity to save thousands of pounds on your tax bill!
No time like the present to purchase a new van from Vansdirect. The end of the tax year is looming, and if you still have some of your Annual Investment Allowance remaining (AIA) then you might want to think about bringing the purchase of a new 19-plate van forward with the opportunity of saving your business money while you’re at it.
Annual Investment Allowance (AIA) is a way of claiming tax relief on a number of assets that you may purchase for your business, in the form of a capital allowance. The allowance limit is currently set at £200,000 and hence if your purchase qualifies as part of the allowance, then you are able to deduct the entire cost of that asset from the profit of your business before calculating the tax you are due to pay on the annual profit.
It may be best to look at an example. Say for instance you purchase a new van for your business at the cost of £10,000 and the profits on your business are £75,000, you can claim AIA on the price of the van and hence you’d be liable to pay tax and national insurance on just £65,000. By purchasing a new van on hire purchase from Vansdirect and signing the contract for the purchase of the new van, if you bring that new van into use within your business before the end of the tax year (April 5th) then you’d be entitled to tax relief for the capital cost of the new van!
In short, no. You can only claim the AIA if the new van is exclusively for business and not personal use. Also you can offset the running costs of the new van against tax when it’s solely used for your business. If your business is VAT registered then you’d be able to claim AIA on the total cost of the new van, subtracting any VAT that you’d be able to reclaim on it. Don’t worry if you’re not VAT registered, you’d still be able to claim the AIA on the total cost of the new van.
By claiming all of the cost of the new van against tax, there will be implications if you do look to sell the van on in future, hypothetically if you do sell your van on in four years for £3,000 for example then you would have to pay the tax rate at the time on the £3,000 you received for the van.
Looking for a new van? Look no further! At Vansdirect we have a huge range of brand new 19-plate vans in stock, with the opportunity to save yourself thousands on a cheap van finance deal and thousands on your tax bill, not forgetting the FREE UK wide delivery! All of our new vans are available with cheap van finance options including: van leasing, contract hire and hire purchase. For a new van bargain, call Vansdirect on 0800 169 69 95 or enquire online and we’ll get back to you asap, we also offer cars!